Performance Equity Partners Inc. tuition billing company
Do any other martial arts instructors out there have any experience with the Performance Equity Partners Inc. accounts receivable financing program? They formally were doing business through the First National Bank and Charter One Bank both in Illinois.
What they do is purchase large contracts from school owners for a large fee ( 5% per year, so if it a three year contract they take 15% off the top), in addition to a processing fee from $99-$249.
A typical example from my school:
Three year contract for a family of four equals $7200. That is $200 per month for three years.
PEP takes $1080 (5% per year) and a $249 processing fee for a total of $1329. This leaves a remainder of $5871. Say the person has ok credit and they grade them at 60%. They then would send us a check for $3522.60 (60%) and deposit the other 40% $2348.40 in the reserve account to be distributed in either January or July.
Then they collect the tuition from the students.
I used them for awhile succesfully, but now have run into problems with them distributing the funds in the reserve account. Currently they have over $19,000 in the reserve account and have not released any money for over a year.
Their reasoning is that I am no longer active with them, which means I have not sent them any new contracts.
This is true because when the economy in my state tanked, the steady stream of new students coming in became a trickle. As I looked out over my dojang and saw a bunch of students that I had already been paid for I realized this was not the best idea.
I realized that I needed to collect the tuition on a monthly basis and at a cheaper rate.
I argued the point with Richard Voboril, Senior VP to no avail. I asked him what guarantee do I have that I ever would get paid and he told me "because I said so".
This remains to be seen I quess. All of the students have paid on time every single time.
Anybody else run into anything like this?
Sounds like they need to have a conversation with your lawyer.
If you want to sue them for breach of contract you can either sue them in regular court for the full amount, or file multiple small claims actions for each student. The second approach can be done by you, and will drive them up the wall because their lawyer will charge them a separate fee for handling each case.
Originally Posted by sheperd
And any confusion as to why Mr Browning deserves that "Hall of Fame" tag is forever dispelled...
Originally Posted by Samuel Browning
Just for clarity's sake, would you advise Sheperd to contact Voboril regarding the possibility of legal action himself, or should the next communication come from Sheperd's lawyer?
His lawyer, it will be more impressive and he needs to talk to a lawyer anyway to review the contract.
Huh. Seems like an odd system. I've got no useful input on your issues with Performance Equity.
If ALL you want is to set up monthly autopay, I'm told you can use Paypal for that at a small percentage. If you want somebody to do more than that (call people if they don't pay, handle peoples' change of accounts so you don't have to, etc), there are a number of companies. Educational Funding Company (EFC) is a big one that does a lot, including business consulting, and ChampionsWay (I have never used ChampionsWay, so I can't vouch for them) supposedly has super low rates for it. Others are pretty easy to find.
All details of the PEP program are explained up front. A dealer agreement is executed by both parties which fully explains the program and the school owner receives a copy. This particular school owner has received multiple, substantial distributions in the past year from his reserve as promised. So in a fully positve sense I confirm the quote in his complaint "because I said so" meaning I gave the man my word that the terms of the dealer agreement would be followed and they were!
Richard Voboril, Nov 2, 2010
Originally Posted by voboril
PEP and its "Manager" are not to be trusted at their word. They give people the run around and do not honor their own agreements. Any legitimate business would be wise to stay away from them, they cause nothing but headaches.